Costello to audit Qld finances

The new Queensland Liberal National Party government has pulled off a coup by appointing former federal Liberal treasurer
Peter Costello
to head a commission of audit to overhaul the state’s finances.

Mr Costello, who is arguably Australia’s most successful treasurer after delivering 10 surpluses in 12 budgets, will head the commission which will be required to submit an interim report to Premier
Campbell Newman
and Treasurer
Tim Nicholls
by June.

The timing of the audit could delay the handing down of the LNP’s first state budget, which is normally delivered in early June.

Mr Costello recently missed out on becoming Future Fund chairman, in favour of
David Gonski
, despite some of his fellow board members saying he was the best person for the job.

The commission of audit, which will have two other commissioners, will work in tandem with the state Treasury to look at Queensland’s budgetary position and chart a path to surplus as well as reclaiming the AAA credit rating it lost in 2009.

The terms of reference for the audit include looking at the state’s balance sheet, including net debt position, revenue and royalty forecasts, expenditure across government, as well as the outlook for the next few years.

It will be tasked with examining long-term projections for goods and services tax revenue under current arrangements as well as potential future arrangements as a result of the Greiner-Brumby-Carter review of the GST allocations which will be released before the commission of audit is due.

The LNP has committed to returning the state budget to surplus by 2014-15, but Mr Nicholls and Mr Newman have already hosed down expectations of reclaiming the AAA rating in their first term of office.

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The audit will be asked to establish whether the impact of the carbon tax, as well as the former government’s commitment to winning the 2018 Commonwealth Games on the Gold Coast, were not “adequately provided" for in a mid-year budget update released in January.

The commission will also look for other financial liabilities that “should be brought to the government’s attention".

Former Labor treasurer
Andrew Fraser
recently described the commission of audit as “disgraceful attack" on the independence and professionalism of state Treasury as well as the Auditor-General, who signs off on the state’s finances.

The removal of long-serving under-treasurer
Gerard Bradley
, who will be replaced by former Brisbane City Council chief financial officer
Helen Gluer
, has fuelled suspicions the LNP does not have full confidence in Treasury under the former Labor government.

Mr Nicholls has previously said the commission of audit was not a slight on Treasury but would provide a “fresh set of eyes" on the state’s finances which needed to be overhauled after 14 years of Labor government.

Mr Newman said a confidential Treasury briefing, known as the “blue book" for the incoming government, had confirmed the state’s finances were not in good shape.

“It confirms the things we said during the campaign, that Queensland’s finances are not in a nice place and we do need to sort things out," he said yesterday.

Mr Newman, who was officially endorsed yesterday by his 75 LNP MPs as parliamentary leader, warned his new colleagues to act with “humility, grace and dignity" after Saturday’s landslide victory.

He said he would have high standards for his ministers to solve problems in their portfolios, but backed away from an earlier comment that they had two years to fix things or would be sacked.

About 40 kilometres west of Brisbane, the Queensland Labor Party got a taste of their new political reality when their seven MPs met in a small meeting room in Ipswich to endorse
Annastacia Palaszczuk
as leader.

Ms Palaszczuk said she was open to sharing opposition portfolios with two independent MPs,
Liz Cunningham
and Peter Wellington.